Hooton on Tax

Matthew Hooton addresses the trans-Tasman tax issue in his SST column:

Class hatred has been central to the government’s political strategy since 1999. The 39% tax rate on people earning more than $60,000 did not raise much revenue. It was designed merely as a symbolic attack on people Labour perceived as too financially successful.

Michael Cullen’s hatefulness boiled over right from the start, with his “we won, you lost, eat that” attack on employers. Sulkily, he cancelled the only tax cuts he ever promised because we weren’t grateful enough.

Matthew is not exagerrating.  Cullen has several times referred to the lack of gratitude as being a factor.  Don’t you love a Finance Minister who decides fiscal policy baed on how grumpy he is!

In Australia, John Howard has delivered tens of billions of dollars of tax cuts, while maintaining schools, hospitals and infrastructure at least as good as ours. His plan is that the first $20,000 of every Australian’s pay packet will soon be entirely tax-free. The lowest-earning Australians will pay nothing in tax. Students will pay nothing for their summer jobs. People earning less than $30,000 a year will pay just 5% in tax. Wealthier Australians will also benefit from these changes.

Our finance minister has slammed Howard’s proposals, saying they are “not the kind of programme you would expect to see from a Labour-led government”. Already Australians take home around 50% more than New Zealanders for the same work. For Cullen, it is a point of pride that he is actually promising to make that worse.

Yep we offer lower wages and higher taxes. What a great combination.